Jurisdiction

Question 1

Heads of jurisdiction based on statute not dependent on service of claim form

Answer 1

(1) Consumer contracts (s 15B)
(2) Employment contracts (s 15C)
(3) Domicile in England and Wales (s 16(1)(b); para 4, para 1)
(4) immovable property situated in England and Wales (such 4, para 11(a))
(5) choice of court agreement (r 6.3632B)(b))

Question 2

AB v Personal Exchange International Ltd - the online gambler: facts and ratio

Answer 2

Facts:
- PEI offered online gambling service via website
- BB opened account and won EUR 227k , playing 9 hours per day and was able to live off thise winnings.
Issue: Is BB a ‘consumer’?
Held: BB cannot be deprived consumer status because of (i) size of winnings; (ii) knowledge of the activity.
However, regularity of activity is a factor to be considered but does not , of itself, establish BB’s classification as a ‘trader’.

Question 3

Gruber - the farm: facts, issue, decision

Answer 3

Facts: Gruber used farm for dual purpose of (i) personal dwelling; and (ii) hotel.
Issue: was Gruber a consume?
Held: consumer provisions cannot be relied on where contract is partly concerned with trade/profession and therefore only partly outside of it.
Trade must be ‘so slight as to be marginal’ and therefore have a ‘negligible role’.

Question 4

When does a person ‘direct such activities’ for purposes of s 15C(1)(c)(ii)?

Answer 4

Per Pammer, activities must show a willingness on the part of the trader to do business with consumers domiciled in the state.
Non-exhaustive matters:
(i) international nature of activity;
(ii) mention of itineraries from other Member States
(iii) use of language or currency other than that generally used in the Member state
(iv) telephone numbers with international code
(v) top level domain name other than in Member state (.eu., .au)
(vi) mention of international clientele

Question 5

Emrek - second hand vehicles: facts, issue, decision

Answer 5

Facts:
- S sells second-hand vehicles from a company in France (border town)
- S had internet site which included contact details in French and German
- Emrek (German) - concluded contract for sale of a second-hand car with S in France.
- Emrek brought claims against S under warrant in Germany on basis that S directed activity to Germany.
Held: ‘direction’ established through:
- trading establishing close t border;
- trader used telephone number allocated by other state.
- no need for website to casually link to contract’s conclusion

Question 6

Test for whether claims “relates to” a consumer contract under s 15B(1)

Answer 6

Action must be indissociable linked to the contract per AU v Reliancto Investments

Question 7

Definition of ‘individual contract of employment’?

Answer 7

Holterman:
(i) autonomous concept;
(i) cannot be determined through national law;
(ii) interpreted in light of objective of protection of employees;

Two key characteristics are: (1) a relationship of subordination; and (2) lasting bond bringing worker within the organisational framework of the business.

Question 8

Bowsworth v Arcadia Petroleum - CEO and CFO in control

Answer 8

Facts:
- CEO and CFO argued they were under an individual employment contract with Arcadia Group.
- CEO and CFO were directors of Arcadia and had drafted employment contracts themselves or at their direction
Held: not in a relationship of subordination because:
- control they had on the terms they were employed
- ability to influence Arcadia was not negligible

Question 9

Does claim ‘relate to’ the employment contract?

Answer 9

Must show that the conduct complained of ‘could be considered a breach of the contract’ (Holterman)

Question 10

Is a form contract required for an individual employment contract?

Answer 10

No - absence of any formal contract does not preclude existence of an employment relationship (Bowsworth)

Question 11

Test for establishing where the employee habitual carries out their work where performance is in several states - for s 15(2)(b)

Answer 11

Criterion of where employee habitually carries out work must be interpreted broadly (Nigeria). Where employee’s performance is in several states, this is the place where the employee actually performs the essential part of his duties vis-a-vis the employer (Nogueria).
Criteria:
* place from which employee carries out transport-related tasks;
* place where he returns after tasks; receives instructions and organises work
* (place where work tools are found
* time spent in places (Holterman)
* importance of the activities (Holterman)

Question 12

Nogueria v Crewlink Ireland - Irish flyer

Answer 12

• employment contract with Ryanair (headquartered in Ireland) in Spain
• proceedings brought against Ryanair in Belgium.
  Factors in favour of Ireland:
• contract provided that Irish courts had jurisdiction over possible disputes;
• contract stipulated work carried out in Ireland
• duties carried out on aircraft registered in Ireland.
  Factors in favour of Belgium:
• Belgium nominated as “home base” - requiring him to live within an hour’s journey of base.
• Employee started working day in Belgium and ended day there.
  Held: Concept of ‘home base’ is a factor likely to play a significant role.

Question 13

Three broad category of jurisdiction:

Answer 13

(1) statutory basis
(2) based on local service (in personal)
(3) service out

Question 14

Concept of ‘individual contract of employment’

Answer 14

• Autonomous concept that cannot be determined through national law (Holterman)
• Interpreted in light of the objective of protection of employees (Holterman)
• no formal/written contract required (Bosworth)

**But will English court’s continue an ‘autonomous interpretation’ post Brexit? **
Yes: consistency across Rome I; protective principle is the same in the UK and EU Models.
No: consistency is necessary across EU private IL because of all the legislative instruments concerning employment and “worker” under EU.

Question 15

Characteristics of an individual employment contract?

Answer 15

1. Subordination
** one person performs services for and udner the direction of another in return for remuneration (Bowsworth*)
* implies the existence of a hierarchical relationship

**2. Lasting bond
** *Employment ocntract creates a last bond which brings worker within the organisational framework of the business

Question 16

Powerful CEO and CFO case

Bosworth v Arcadia Petroleum

Answer 16

• CEO and CFO (British nationals domiciled in Switzerland) challenged UK jurisdiction on the basis that they were under an individual employment contract with Arcadia Group.
• CEO and CFO were directors of Arcadia companies
• They had drafted employment contracts themselves or at their direction.
  Held: Not in a relationship of subordination because:
• control over where and on what terms they were employed.
• ability to influence Arcadia was not negligible
• the fact that they were answerable to the Arcadia Group’s shareholders (who had the power to ‘hire and fire’ them) is irrelevant.

Question 17

Director with influence

Holterman

Answer 17

• Holterman terminated Mr Spies’ (Director) contract of employment and brought claims on basis of misconduct.
• Mr Spies challenged Netherland’s jurisdiction on the basis that we was not under an individual employment contract.
• Was there subordination? Turned on whether Mr Spies was able to influence bodfy in a non-negliglbe way, such that there was no relationship of subordination.
• Could be demonstrated should holdings in share capital.

Question 18

Statutory basis of jurisdiction over defendant domiciled in UK?

Answer 18

English court has jurisdiction over persons domiciled in England and Wales through s 16(1)(b) reading with sch 4, para 1.

Question 19

Statutory test for domicile

Answer 19

Two requirements under s 41(2) - D must be:
1. resident in the UK:
Residence is not defined but indicates a degree of permanence of continuity (Bank of Dubbia)
2. nature and circumstances indicate that D has a substantial connection with the UK
Presumption of substantial connection if resident in UK for last three months or more (s 41(4))

Question 20

Choice of court agreement - statutory basis of jurisdiction (non-Hague)

Answer 20

Court has statuory basis of personal jurisdition where a contract provides that English court shall have jurisdition to determine the claim (r 6.33(2B)(b))

Question 21

Staying proceedings on ground of FNC where personal jurisdiction is established on statutory basis.

Answer 21

Section 49(3) - court has power to stay proceedings on the ground of FNC per s 49(3).
Policy weight may go against finding a stay where jurisdiction is statutory (Kennedy)

Question 22

Framework for jurisdiction based on local service

Answer 22

A. Jursidction in personam

Court has jurisdiction to entertain claim in personam against D who is: (1) present in England; and (2) duly served there (Colt Industries).

B. Wil court decline to exercise jurisdiction
D may apply to the court for an order that it should not exercise its jurisdiction based on FNC grounds (r 11(1), CPR; The Atlantic Star).

Question 23

Fleeting appearance

Colt Industries

Answer 23

• D vising UK for a few days.
• P issued and served D with writ in action (relying on New York judgment).
  Held: in the absence of fraud inducing D to enter into the UK for the ‘sole purpose of serving him with a writ’, the court has jurisdiction in any action in personam.
  It is immaterial that:
• the cause of action arose outside jurisdiction; or
• that defendant was only in jurisdiction for a short period (or ‘merely casually’).

Question 24

Fraudulent inducement exception to jurisdiction in personam

Answer 24

Service is not valid if D is induced to enter the jurisdiction on the ‘mere pretex’ to be served a writ. However, if there was a ‘real intention’ behind the invitation, service is valid (Watkins)

Question 25

Service where defendant is out of jurisdiction

Answer 25

CPR rr 6.2 to 6.5 does not exclude service simply because D was out of the jurisdiction (City & Country Properties)

Question 26

City & Country Properties

Answer 26

• P served claim form by sending it to his place of business.
• D carried on business and resided in the UK.
• Defendant argued he had not been duly served under CPR r 6.5 because he had been temporarily out of jurisdiction.
  Court: Lord Neuberger MR:
• Rules 6.2 to 6.5 do not exclude service simply because D is out of the jurisdiction (e.g., on a holiday).
• Court approved statement in Chellaram (courts only exercise jurisdiction against those subject to its jurisdiction) subject to the qualification that temporary absence does not result in a person not being subject to the jurisdiction.

Question 27

Declining jurisdiction based on local service

Answer 27

D may apply to the court for an order that it should not exercise its jurisdiction based on forum non conveniens (r 11(1), CPR; The Atlantic Star).
D to acknowledge service and make an application under r 11(1) within 14 days supported by evidence (r 11(4)) - although Cook suggests that a Court can set aside on its own initiative.

Question 28

Structure for permission to serve outside jurisdiction

Answer 28

X may serve claim form out of jurisdiction with the court’s permission where the following conditiosn are met (rr 6.36; 6.37). X will have burden of proof on these matters and, as the application is made without notice, has an obligation of full and fair disclosure of all relevant facts (Sharab):

1. Merits test
There must be a ‘real, as opposed to a fanciful, prospect of success on the claim’ (AK Investments) - which is teh same test for resisting summary judgment (Altimo).

2. Jurisdictional gateway
X must establish a ‘good arguable case’ that claim falls within one of hte gateways in PD 6B para 3.1 (AK Investments), requiring the ‘better of the argument’ (Brownlie II, being a test of relative plausibility per Kaefer).

3. Proper place
The court will not give permission unless satisfied that England and Wales is hte proper place in which to bring the claim (r 6.37(3))

Question 29

Tort gateway - concept of “damage” under para 3.1(9)(a)

Answer 29

• Per majority in Brownie II, ‘damage’ extends to all actionable harmed caused by the tortious act, including all the bodily and consequential financial effects which the claimant suffers.

Question 30

‘Damage’, Brownie II and pure economic loss

Answer 30

The impact of Brownlie II on pure economic loss claims arising from tort is not settled. The issue is whether there is a need to distinguish between pure economic cases as opposed to personal injury cases.
Lloyd-Jones LJ indicated in Brownlie II that a ‘remoteness’ test is appropriate for pure economic loss cases.

Question 31

Contract gateway where D is not party to the contract

Answer 31

Court may be resistant to permitting service out under contract gateway where D is not party to the contract. This is because connection is more elusive where defendant is not party (Alliance Bank).

Question 32

Framework: necessary or proper party (para 3.1(3)/(4)) - adding additional parties to a given action

Answer 32

1. Claim against anchor defendant (D1) who will be served otherwise than under para 3.1(3)
2. Real issue between C and D1
3. D2 is a necessary or proper party

Question 33

When is D2 a necessary or proper party?

Answer 33

• D2 is a proper party if C’s claims against D1 and D2 involve ‘one investigation’ (Altimo), i.e., ‘closely bound up’ or ‘common thread’ connection (Carvill America).
• Will not be successful if true inference from all the facts is that the sole reason for suing D1 is to found an application to join D2 (Multinational Gas).

Question 34

Multinational Gas

Answer 34

• C brought action against company in liquidation (duly served) - although C had no real prospect of recovery against company.
• C brought application to serve D2 outside jurisdiction.
  Issue: was it the true inference from all the facts that hte sole reason for suing D1 was to found an application to joing D2 to the action?
  Held: action against D1 was bona fide and properly bought.

Question 35

Further claims (same party) gateway - para 3.1(4A)

Answer 35

1. Initial claim against D must have been:
   (i) served on D within jurisdiction; or
   (ii) falls within r 6.33 (s 15A to 15E); or
   (iii) falls within particular gateways.
2. Further claim against D ‘arises out of hte same or closely connected facts’

Question 36

Brownlie II - concept of damage under para 3.1(9)(a)

Answer 36

• C claimed for damages: (a) person injury in own right; (b) her capacity as executrix of estate; (c) for bereavement and loss of dependency as widow.
• Issue on appeal to SC was whether ‘damage’ was sustained within England for the purposes of para 3.1(9)(a).
  Held (Lloyd-Jones, Reed, Briggs and Burrows LLJ agreeing):
• ‘damage’ refers to actionable harm, direct or indirect, baused by the wrongful act alleged.
• for personal injury/wrongful death, ‘damage’ extends to the actionable harm caused by the tortious act, including all bodily and consequential financial effects which the claimant suffers.
  Therefore, C’s damages have been suffered in England.
  **Dissent, Lord Leggatt: **:
• majority’s broad interpretation renders tort gateway ‘an open territory with no fence’
  Dissent (Brownlie I), Lord Sumption (with whom Lord Hughes agreed):
• damage means direct damage and does not extend to financial of physical consequences of an initial physical damage.

Question 37

FNC Framework where defendant seeks stay

Answer 37

D may apply for an order that it should not exercise its jurisdiction based on forum non conveniens (r 11(1), CPR; The Atlantic Star). D has burden persuade court to exercise its discretion.

Court will apply the two-part test in Spilada:

1. Natural forum
D must show not just that England is not the natural or appropriate forum, but to establish that [foreign forum] is ‘clearly or distinctly’ more appropriate than the English forum (Spiliada, Goff LJ; Lubbe v Cape

2. Justice
Burden shifts to C to show that there are special circumstances by reason of which justice requires that the trial should nevertheless take place in England.

Court will need to be satisfied, by cogent evidence, that there is a real risk that substantial justice will not be obtainable in [foreign jurisdiction] (Vedanta; Spiliada).

Question 38

FNC framework - proper place analysis (C’s application)

Answer 38

Court will not give permission to serve out unless it is satisfied that England is hte proper place to bring the claim (R 6.37(3))

1 Natural forum
Burden is on P to persuade court that England is ‘clearly or distinctly’ the appropraite forum for the trial (Spiliada).

2 Justice
If court concludes that there is another forum that is as suitable or more suitable than England, normally refuse permission unless justice otherwise require that permission should nevertheless be granted.

Court will need to be satisfied, by cogent evidence, that there is a real risk that substantial justice will not be obtainable in the foreign jurisdiction (Vedanta; Spiliada).

Question 39

Natural forum factors

Answer 39

1. Availability of witnesses (VTB)
2. Multiplicity of proceedings (Spiliada)
3. Risk of irreconciliable judgments (Vedanta)
4. Law governing transaction (VTB)
5. Place of commission of allegedly wrongful act (VTB)
6. Non-exclusive choice of court agreement (VTB)
7. Common language (translation) (Vedanta)

Question 40

Russian case

VTB Capital

Answer 40

Availability of witnesses and evidence
* Relevant evidence came in large measure from Russia and Russian witnesses
* ‘oral and documentary evidence, on both factual and expert matters, is likewise likely to be overwhelmingly Russian and to be found in Russia’.

Law governing the transaction
* Governing law was English, which was a positive factor in favour of England.
* However, only of particular force if: (i) issues of law are likely to be important; and (ii) there is evidence of relevance difference in legal principles between two countries.
* Not strong here.

Place of commission of wrongful act
* Common design was formed in Russia.
* Representations emanated from Russia.

Question 41

Vedanta

Answer 41

• Claimants (extremely poor Zambian residents) seek compensation for negligence / breach of Zambian statutory duty in connection with escape within Zambia of noxious substances.
• These substances arose from the operation of a Zambian mine.

Availability of witnesses
* witnesses of fact are all based in Zambia.
* these witnesses far outnumber potential witnesses of defendant (Vendanta), some – but not all – of whom may be domiciled in England.

Risk or irreconcilable judgment
* The reason a parallel pursuit of a claim in England (against Vedanta) and in Zambia (against KCM) would give rise to a risk of irreconcilable judgments is because the claimants have chosen to exercise that right to continue against Vedanta in England, rather than because Zambia is not an available forum for the pursuit of the claim against both defendants.
* As claimants have brought it upon themselves - this is not a decisive factor.

Common language
* Many of the claimants only spoke a local dialect which would require translation in order to be understood by an English judge or advocate, but not by their Zambian equivalents.
* Many of claimant’s documents would require translation for use in an English court (but not in a Zambian court).